Quashed Service tax demand on movie exhibitor under the category of Business Support Service

Last updated: 17 November 2021
Quick Summary
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has ruled that the service of exhibiting movies by a cinema exhibitor to film producers/distributors does not fall under the category of Business Support Service (BSS). The tribunal found that movie exhibition is an independent activity, not a support or assistance function, and therefore, service tax cannot be levied on Inox Leisure Ltd for this activity. This decision overturns a previous demand for service tax, interest, and penalty.

Court :
CESTAT, Hyderabad

Brief :
The Hon'ble CESTAT observed that, the agreement between producer/distributor engaged in business of production and distribution of films and the Appellant is of such nature that both the parties work independently and does not interfere or influence any decision on the other party.

Citation :
Service Tax Appeal No. 30489 of 2016 decided on October 20, 2021

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